The government looks to raise P160 billion from domestic sources next month, according to a program released by the Bureau of the Treasury (BTr) on Tuesday.

If followed, the program would be an acceleration from the P140 billion set for this month.
Of the amount, the government would borrow P100 billion by issuing Treasury bills (T-bills) and P60 billion by issuing Treasury bonds (T-bonds).

Of the T-bills amount, P25 billion would be sourced through the 91-day tenor, P25 billion through the 182-day tenor, and P50 billion through the 364-day tenor. Of the T-bond figure, P30 billion would be generated from the seven-year tenor and the rest through the 10-year tenor.

Budget department data showed that the government targets to raise P2.58 trillion in financing from domestic sources this year. Of the total, P50 billion and P1.53 trillion would come from the issuance of Treasury bills and fixed-rate Treasury bonds, respectively, and P1 trillion is targeted to be raised from short-term borrowing from the Bangko Sentral ng Pilipinas.

Thus, local debt at the end of 2021 is projected to hit P8.49 trillion, increasing the government’s outstanding debt to P11.98 trillion.

Latest data showed that gross domestic financing in the first 11 months of 2020 reached P3.04 trillion. Local borrowings were sourced from the issuance of P465.30 billion worth of T-bills and P631.74 billion worth of fixed-rate bonds.

The government also raised P827.10 billion from the issuance of retail T-bonds.
The government closed 2020 with a huge debt — P9.79 trillion — equivalent to 54.5 percent of the total economy.

The December 2020 amount was higher by 3.3 percent or P339.05 billion than the P10.13 trillion in November “primarily due to net redemptions of domestic loans,” the BTr said.

It added that the government debt stock ballooned by P2.06 trillion or 26.7 percent, “attributed to higher funding requirements to respond to the 2019 coronavirus disease (Covid-19) pandemic.”

Of the figure, 68.35 percent was generated from local creditors and the rest was secured externally. Local obligations reached P6.69 trillion, a 6.9-percent reduction from end-November’s P7.19 trillion. Outstanding domestic obligations in the previous year stood at P5.12 trillion.

The Treasury said the wider share of domestic obligations relative to the total debt stock was on the back of the government’s continued reliance on domestic borrowing to meet its financing needs.

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